China central bank sees room for easing: report

BEIJING--China has the policy room to support economic growth by adopting both fiscal and monetary measures, the People's Bank of China Vice Governor Yi Gang said in an interview with the state-run Financial News.

Unlike other countries that are burdened with high fiscal deficits or have already implemented a zero interest rate policy, China is well positioned to adopt both fiscal and monetary policies to support economic growth, Mr. Yi said, according to the newspaper on Monday.

The vice governor also said monetary policymakers continue to use preemptive macroeconomic measures to ensure stable and sustainable economic growth in the world's second-largest economy.

China posted 7.6% economic growth in the second quarter of the year, the slowest pace in more than three years. The National Bureau of Statistics is scheduled to release third-quarter gross domestic product data on Thursday.

Mr. Yi also told the newspaper that the latest round of quantitative easing by the U.S. and a bond purchase plan by the European Union could have a mixed impact on the Chinese economy. Quantitative easing helps boost demand in major market economies and thus benefits Chinese exports, but it might also raise new risks of imported inflation, he said.

The vice governor also mentioned that BRICS countries--Brazil, Russia, India, China and South Africa--are looking at deepening their cooperation by setting up a mechanism to provide liquidity for all of these economies, according to the report.

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